Responding to the latest official labour market statistics, showing the
unemployment rate rose to 5.1% in the three months to December, Tej
Parikh, Chief Economist at the Institute of Directors, said:
"As the pandemic lingers, jobs losses have continued to
tick upward.
"Tight restrictions over the winter months will have eaten
into many businesses' reserves, forcing them into difficult
decisions on their staff. Meanwhile, cash-strapped firms have
relied on the furlough scheme to help retain employees, and
without it unemployment would be significantly higher.
"The vaccine roll-out and reopening of the economy this
year should help put a ceiling on job losses, but the Government
will need to provide ongoing help. With restrictions remaining in
place over the coming quarters, the Chancellor must move quickly
to extend the Job Retention Scheme and other Covid-19 economic
support beyond the spring.
"The Budget next week needs to provide a bridge for
businesses to begin the process of rescaling and rehiring. A
one-off relief for employers' National Insurance contributions
would boost cashflow, and support job retention and creation.
Financial incentives to support training and reskilling will also
help firms to adjust and grow quickly, supporting the
recovery.
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